More Focus On General Insurance Regulation?
At the end of last month, the FCA fined Liberty Mutual Insurance Europe SE over £5 million for failures in their oversight of mobile phone insurance claims and complaints handling processes administered through a third party. Liberty held regulatory responsibility for ensuring claims and complaints from customers were handled fairly. In the 2018/2019 FCA Business Plan, third-party outsource was named as a key area for review and this is the most high profile case involving it so far this year. The Business Plan states that they’re concerned about the ever-growing number of authorised firms outsourcing crucial procedures to unregulated third-parties, and the FCA are looking to re-enforce the fact that firms will be held responsible for the failings of anyone they subcontract compliance or complaints work to.
This is also the latest FCA case focussing on a general Insurer, another area the regulator has been giving greater focus to recently. The scope of Insurance regulation could expand further in the near future with the FCA currently running a probe on car and home insurance pricing and transparency around renewals. Adding to the FCA’s wider work on “loyalty penalties” and the cross-industry problem of long-time customers sometimes getting worse deals than new ones, we’re looking at a lot of potential issues that could create new KYC problems for the industry, for example; where customers are looking for credit to pay for their insurance premiums, affordability checks could prevent them from renewing with their preferred insurer. In addition to this, the Senior Managers and Certification Regime (SMCR) will be applied to General Insurance from December, creating a whole new set of responsibilities, fitness and propriety testing requirements for senior management across the sector.
Kind Consultancy is currently having discussions with a number of insurers regarding review of their practices, processes and procedures. If you need experienced, knowledgeable compliance and complaints contractors, we have a pre-qualified bank of industry-leading interim talent who can quickly and efficiently join our clients to support current and future projects relating to these issues. For a confidential conversation about your regulatory needs, contacts selena@kindconsultancy.com or call 0121 643 2100.
– Selena Tye
